Roadmap for the early implementation of the Capacity Allocation Mechanisms Network Code - Update of October 2013
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Roadmap
for the early implementation
of the Capacity Allocation
Mechanisms Network Code
Update of October 2013
Content
1. Executive Summary ......................................................................................................... 3
2. Background..................................................................................................................... 6
3. Governing Arrangements ................................................................................................ 7
3.1. Need to update the current governing structure ................................................................. 7
3.2. Roles and responsibilities within the new framework .......................................................... 8
4. Implementation ............................................................................................................. 11
4.1. Scope of projects related to CAM NC provisions ................................................................ 11
4.2. Implementation timelines at project level.......................................................................... 16
4.3. Geographical scope of the projects .................................................................................... 19
4.4. Review of issues related to CAM implementation challenges............................................ 20
4.5. Review of lessons learned, solutions adopted and open questions arising during CAM NC
early implementation ...................................................................................................................294
4.6. Key factors for success in early implementation of CAM ................................................... 29
ANNEX 1: Pilot Projects Main Features .................................................................................. 31
ANNEX 2: Early implementation of CAM NC per Interconnection Point .................................. 43
Page 2 of 46
1. Executive Summary
The XXI Madrid Forum of 22-23 March 2012 called upon “TSOs, with the full involvement of
relevant NRAs and Member States, to work towards setting up a number of regional pilot
projects and regional pilot platforms” for the early implementation of the Network Code on
Capacity Allocation Mechanisms (hereafter the CAM NC). A draft Roadmap was presented at the
XXII Madrid Forum of 2-3 October 2012. Participants invited ACER and ENTSOG “to promote the
convergence of the ongoing projects to avoid duplication of costs, as well as to report on
progress of implementation at its next sessions”.
The CAM Roadmap was published on 1 March 2013 on ACER and ENTSOG websites1 and
presented at the XXIII Madrid Forum of April 2013. The Forum welcomed the CAM Roadmap
and encouraged ACER and ENTSOG to “continue the work in close cooperation with the relevant
stakeholders by e.g. collecting and documenting common problems and best practices to enable
efficient solutions.”
This updated version of the CAM Roadmap presents the state of play of pilot projects for the
early implementation of the CAM NC, including the implementation of key provisions of the
CAM NC at interconnection points. This updated Roadmap also contains information on the
valuable experience gained from the solutions adopted and the open questions shared by the
participants in the pilot projects during the first quarters of 2013. All parties involved – ACER,
ENTSOG, European Commission, TSOs and NRAs – have cooperated closely in this update of the
Roadmap, starting from the experience gained through the existing CAM pilot projects.
Early implementation of the CAM NC provisions can potentially promote, on the one hand,
significant progress towards the internal market by 2014 and, on the other hand, opportunities
to share knowledge about the experience gained from voluntary early implementation through
pilot projects before the CAM NC provisions become binding on 1 November 2015.
The Roadmap aims to support this knowledge sharing by:
Providing background information about the Roadmap elaboration process, by
describing when and how it was decided to carry out such a Roadmap and the main
steps of the process leading to its development;
Outlining the organisational arrangements that can help to oversee and facilitate the
implementation process during the implementation of pilot projects;
1
http://www.acer.europa.eu/Gas/Regional_%20Intiatives/CAM_roadmap/Pages/default.aspx
http://www.entsog.eu/public/uploads/files/publications/CAM%20Network%20Code/2013/a)%20CAM%20Roadma
p%20-%20Final%20version%20010313%20-%20v2.pdf
Page 3 of 46
Describing roles and responsibilities for all parties involved in developing and facilitating
pilot projects;
Providing an overview of this implementation process:
o reporting on how current projects are implementing key provisions of the CAM NC;
o reporting at the level of interconnection points which firm standard capacity
products (where available) are being offered and how they are being offered in the
course of early implementation (included in this updated version of the Roadmap);
Mapping the geographical scope of the projects;
Reporting the implementation challenges and issues identified by project participants;
Listing key factors that have been identified as contributing to the success of early
implementation efforts;
Eventually enabling the convergence of current (or yet to be started) pilot projects
towards integrated solutions.
The CAM Roadmap is structured in two main parts. It first focuses on the governance of the
pilot projects i.e. how all parties involved will relate and communicate in order to monitor and
facilitate these projects, while in the second part details on the implementation of the pilot
projects are provided.
As explained above, the first version of the CAM Roadmap was published in March 2013 and is
now updated including information on recent developments of the projects. This document will
be updated periodically to reflect progress in the early implementation of the CAM NC.
The diagram in Figure 1 is intended to give an overview of the main steps and targets to be
reached until the end of 2013, as part of the early implementation of the CAM NC within the EU.
These include:
Key milestones in the pilot projects forming the building blocks for this Roadmap (more
details in section 2); and
Steps envisaged as part of the governance process, to support the projects in attaining
their goals (more details in section 1).
Page 4 of 46
Figure 1 – Key achievements in early implementation and planned targets until the end of 2013
Page 5 of 46
2. Background
The Roadmap has the goal of fostering the early implementation of the provisions from the
Network Code on capacity allocation mechanisms (CAM NC), before it becomes legally binding
on 1 November 2015 after its adoption through the so-called Comitology process in 2013. For
that purpose, the Roadmap identifies and monitors sequential steps of implementation through
pilot projects at cross-border interconnection points in EU Member States, which will test the
NC provisions, hence paving the way towards the timely implementation of the CAM NC across
Europe. The early implementation is a voluntary process and relies on the commitment of TSOs
and NRAs involved in the pilot projects, as well as on the support of ACER, ENTSOG, the
European Commission and stakeholders.
Early implementation of CAM NC is offering the opportunity to draw lessons from the
experience gained during pilot projects’ implementation in order to support and encourage
further work and therefore promote significant progress towards the creation of the gas internal
market by 2014. To achieve this goal the Roadmap intends to: (i) provide an overview of
projects currently under development, (ii) share information, in particular on best practices, and
identify issues and solutions adopted throughout the development of the voluntary projects, (iii)
set targets for future work within the scope of the Roadmap, (iv) describe roles and
responsibilities for all the parties involved in the development of the pilot projects and (v)
promote, to the extent possible, transparency in the process towards stakeholders and
convergence of the pilot projects towards a coherent implementation of the CAM NC provisions
with the same understanding across the different projects throughout Europe.
The CAM Roadmap, published on 1 March 2013, was presented at the XXIII Madrid Forum of
April 2013. The Forum welcomed the CAM Roadmap and encouraged ACER and ENTSOG to
“continue the work in close cooperation with the relevant stakeholders by e.g. collecting and
documenting common problems and best practices to enable efficient solutions.” The Forum also
invited ACER and ENTSOG to “promote the convergence of the on-going projects to avoid
duplication of costs, as well as to report on progress of implementation at its next sessions.”
The Roadmap which will be described herein after is articulated in two parts. The first one
describes the organisational and governing framework, namely how all parties involved in the
Roadmap relate and communicate with each other in order to facilitate a smooth
implementation of CAM pilot projects. The second part first illustrates the timeline for
implementation of each pilot project, together with a description of the network code
provisions which are contextually implemented by those projects, and secondly presents the
timeline and milestones of each project.
Page 6 of 46
3. Governing Arrangements
3.1. Need to update the current governing structure
The CAM Roadmap represents a novelty in the context of the Gas Regional initiative since it
focuses on a cross-regional dimension, which is essential to increase consistency between and
across the work of the regions and thus efficiently pave the way to the completion of the
internal market by 2014. In 2012 the Gas Regional Initiative experienced a step-change in pace
with the launch of the Implementation Roadmap of capacity allocation mechanisms (CAM
Roadmap).
The introduction of this cross-regional approach is favoured if the parties involved in the
projects’ implementation build upon the work already done and share the results obtained
across the three regions in order to identify best practices and efficient market-tested solutions.
The CAM Roadmap does not intend to add unnecessary bureaucracy; indeed it aims to build as
much as possible upon existing structures and it takes into account the experience gained at
regional level through structures such as the Regional Coordination Group (RCC), the
Stakeholders Group (SG), the Implementation Group (IG) and others. However, it is time to add
an additional EU-wide dimension, able to promote cross-regional coordination among projects,
collaboration between ACER and ENTSOG and a framework for information and consultation to
relevant stakeholders of the European gas sector.
Indeed, the Roadmap is a tool to facilitate the early implementation of CAM NC by:
Promoting experience sharing and exchange of lessons learned between existing and
future pilot projects voluntarily launched by TSOs and NRAs;
Ensuring that lessons drawn from the implementation of pilot projects are carefully
considered when the identification of solutions to problems related to the
implementation of another project is required;
Informing adequately all interested stakeholders about the ongoing process;
Enabling ACER and ENTSOG to monitor the whole process, as requested by the Madrid
Forum, ensuring the coherence of solutions adopted by the different projects, avoiding
the duplication of costs and aiming to facilitate and enable the early implementation of
the CAM NC.
Page 7 of 46
3.2. Roles and responsibilities within the new framework
The main pillars of the CAM Roadmap are represented by pilot projects. Parties involved in each
pilot project are the best placed to decide on the organisational structure that suits them best
(i.e. using the current regional groups – RCC, SG, IG – if they wish, or setting up ad-hoc groups).
For the sake of simplicity, the groups managing each pilot project are identified in this CAM
Roadmap document as “Core Groups”.
Each Core Group is made up of TSOs implementing a pilot project and responsible NRAs. They
may also collaborate with relevant stakeholders to exchange views on the project features. The
Core Group oversees pilot project implementation and it mainly deals with the identification of
national requirements and the resolution of technical and legal questions related to the project.
In order to favor coordination at cross-regional level, each Core Group is invited to appoint two
(or more) representatives (at least one from the NRAs and one from the TSOs) which have the
task to report on progress made, obstacles faced, solutions adopted and identified issues of
general interest. The latter encompasses issues that need to be discussed at EU level because
they may affect other projects.
The cross-regional coordination is ensured by two new groups, namely: an EU Stakeholders
Group and a CAM Coordination Group. These groups work in close cooperation with ACER and
ENTSOG which have the important role of promoting and facilitating a consistent
implementation of the CAM projects across Europe concomitantly to the market developments
of each gas region.
The EU Stakeholders group comprises representatives of the European Commission, ACER,
ENTSOG, Member States, NRAs and TSOs representing the pilot projects (as well as other NRAs
and TSOs interested), the Lead Regulators of the three gas regions and stakeholder associations,
and has the aim to:
Involve and engage EU stakeholders;
Promote a high level of transparency in each step of the implementation process.
The CAM Coordination group encompasses EC, ACER, ENTSOG and NRAs and TSOs representing
the pilot projects. Member States have also the possibility to participate; other interested NRAs
and TSOs may be invited as well. Its main aim is to facilitate the implementation process by:
Building a common understanding on how to apply NC provisions;
Identify and exchange best practices among participants and anticipate any issue or
complexity arising from the implementation process, so as to promote the adoption of
the most effective solution or solutions building upon the work already done;
Page 8 of 46
Monitor the developments of the projects’ implementation according to the objectives
and timeline set in the Roadmap;
Discuss the evolution of national regulations aimed at ensuring consistency between the
pilot projects;
Support projects facing problems and/or delays which might arise in the course of the
projects’ implementation, by helping to identify and promote solutions. The aim will be
to resolve problems swiftly and with a consensual approach.
This new framework and the interaction between the different groups can be represented as
shown in the figure in the following page.
The first meetings of respectively the CAM Coordination Group and the EU Stakeholders Group
took place on 6 March 2013 in Brussels and were well attended, including ACER, ENTSOG, EC,
TSOs, NRAs and stakeholders representatives. At these meetings, the state of play of the pilot
projects as well as the adaptation of national regulatory frameworks was presented followed by
a constructive dialogue on the issues and difficulties encountered so far and suggestions to
address them. Stakeholders also had the opportunity to be informed about the process, asking
questions and clarifying their doubts. These first meetings were widely recognised as being
useful by all participants.
The second meetings of the two respective groups took place on 18 September in Ljubljana,
where a review of the progress on projects’ implementation was carried out, and discussions
were held on the issues of common interest arising on the implementation process.
Page 9 of 46
Page 10 of 46
4. Implementation
This second part of the Roadmap illustrates the details of the implementation of the CAM NC
provisions for each of the projects involved. For this purpose, the following sections have been
included:
Description of the network code provisions that are in place or are foreseen to be
implemented
The timeline and milestones of each project
Geographical scope of the projects
Review of issues, lessons learned, solutions adopted and open questions that arise
during CAM NC early implementation
Key factors for success in early implementation of CAM
A fuller description of each project can be found in Annex 1.
Finally, Annex 2 contains a table which provides information at the level of interconnection
points (IP) on the firm standard capacity products (where available) being offered and how they
are being offered in the course of early implementation.
4.1. Scope of projects related to CAM NC provisions
The table below summarises the pilot projects currently taking place in EU Member States.
As early implementation of the CAM NC is voluntary, it should be noted that the table does not
represent an assessment of implementation compliance by ACER or ENTSOG but instead is
intended to give an overview of the scope of projects in progress and the approaches taken.
Page 11 of 46Member
PROJECT NAME Project description States TSOs involved
involved
Bayernets, BOG,
Energinet DK, Fluxys
Austria,
Belgium, FluxysTenp,
Belgium,
Common platform for the Gascade, Gas Connect
Denmark,
allocation of capacity Austria, GRTgaz, GRTgaz
France,
1* PRISMA according to CAM NC rules. Deutschland, GTS, GTG
Germany,
Implementation will be Nord, GUD, Nowega,
Italy,
progressive starting in April Ontras, Open Grid
2013. Europe, Snam Rete Gas,
Netherlands
TAG, Terranetsbw,
(at present)
Thyssengas
(open to other TSOs)
1) Pilot: Allocation of
bundled quarterly product
Bundled Product at according to CAM NC rules Germany, Ontras,
2
Lasów 2) Allocation of all bundled Poland Gaz-System
products according to CAM
NC
Allocation of firm rolling
monthly bundled capacity on
Bundled Product
the HU-RO interconnector FGSZ,
and Capacity Hungary,
3 via the Regional Booking Transgaz
Platform -Hungary/ Romania
Platform according to the (open to other TSOs)
Romania
CAM NC, applying the
‘product bundling’ principle
Coordinated
implementation of
Allocation of standard GRTgaz,
CAM NC at all IPs France,
products as a bundled TIGF,
4** between entry-exit Portugal,
product via auctions in REN,
systems in the South Spain
virtual points Enagas
Region: France,
Portugal and Spain
* Some functionalities provided by the platform may not be adopted by all connected TSOs
during the voluntary phase of CAM early implementation. The information below shows which
of these elements are being implemented at which IPs.
** At this stage, it is envisaged that the progressive auctioning of standard bundled products at
the IP between GRTgaz North-GRTgaz South and the IP between France and Spain will take
place on the PRISMA platform.
Page 12 of 46CAM NC IMPLEMENTATION PER PROJECT
The below table reports on:
Provisions already in place by the end of 2012 (marked with 2012)
Key provisions of the CAM NC that current projects are already planning to implement by
the end of 2013 (marked with 2013)
Key provisions of the CAM NC that current projects are already planning to implement by
the end of 2014 (marked with 2014).
Coordinated
Bundled
implementation
Product and
Projects
Bundled of CAM NC at
CAM NC 2 Capacity
PRISMA Product at all IPs between
Provisions Platform -
Lasów entry-exit
Hungary/
systems in the
Romania
South Region
Joint, anonymous, web-
based platform 2013 2013 2012
established
Using already existing
Platform
platforms 2012 2013
Web-based platform
not yet used 2012
Platform offers
secondary capacity 2014 2014
Yearly 2013 2014 2013 2012
Bundled Capacity
Standard Firm
Quarterly 2013 2013 2013 2012
Products
Monthly 2013 2014 2013 2012
Day Ahead 2013 2014 2013
Within-day 2013
1 Some functionalities provided by the platform may not be adopted by all connected TSOs during the voluntary
phase of CAM implementation. The information below shows which of these elements are being implemented at
which IPs.
Page 13 of 46Auctions used 2013 2013 2013 2012
Other allocation
method currently used 2012
CAM timings 2013 2013 2013 2012
Auction
timings
Other auction timings 2013 2012
Ascending clock
algorithm for yearly,
2013 2013 2013 2013
Auction algorithm
monthly, quarterly
products
Uniform price algorithm
for day-ahead, within- 2013 2014 2013 2013
day products
Bundled product
offered 2013 2013 2013 2012
All capacity offered as
bundled to the extent it 2013 2013 2013 2012
Bundling
can be matched
Follows CAM NC rules Not 2012
on offer of unbundled 2013 applicable 2013
capacity
Virtual Interconnection Not Not Not
Point established 2012
applicable applicable applicable
CAM Centralised
Approach
Nomination
2013
(i.e. Single Nomination)
Decentralised Approach
2012
(i.e. double nomination)
Day-ahead product
Interrupti
2013 2013
offered
ble
Other interruptible
2013 2012
products offered
Page 14 of 462013
Default interruption
(At discretion
lead time used
of TSOs)
2013
Other interruption lead
(At discretion
time used
of TSOs)
Timestamp + pro rata 2013 At discretion of
approach to (At discretion TSOs and NRAs
interruption sequence of TSOs) involved
2013 At discretion of
Other approach to
(At discretion TSOs and NRAs
interruption sequence
of TSOs) involved
One contract with each
2013 2013 2013 2012
Contract
TSO
model
Single contract
Co-operation practices
co-operation
Principles of
2013 2013
in line with CAM NC
Other co-operation
practices currently used
National
Reserve price = discretion of
2013 2013 2012
regulated tariff TSOs and NRAs
involved
National
50:50 default rule
discretion of
applied for split of 2013 2013 2012
TSOs and NRAs
auction premium
Tariffs
involved
National
Other rule applied for
discretion of
split of auction
TSOs and NRAs
premium involved
National National
Over and under
discretion of discretion of
recovery mechanisms
TSOs and NRAs TSOs and NRAs
approved by NRA involved involved
Page 15 of 464.2. Implementation timelines at project level
PRISMA
Main 2011 2012 2013 2014 2015
Milestones Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
CAM in place
PRISMA
Joint platform
1. Announcement of initiative
2. Analysis of CAM NC requirements
3. Discussions with NRAs to ensure national regulatory context allows early implementation of
CAM
4. Development of process and functional specifications
5. Development of ICT specifications
6. Foundation of new company
7. Implementation and testing
8. Prepare and implement go-live
9. Integration of new TSOs
10. Progressive implementation of new features (continues throughout 2014)
Bundled Product at Lasów
2011 2012 2013 2014 2015
Main
Milestones Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Bundled
CAM in place
Product at
Lasów
1. Discussions between NRAs and TSOs on nature and arrangement of the project conducted
2. Concept paper developed and agreed for the Pilot project
3. Development of Cooperation Agreement and Terms and Conditions for both networks
4. Implementation of IT infrastructure with respective platform and TSO interfaces complete
5. Go live and first auctions – Pilot project (June 2013 auction for first three quarters of 2014)
6. Memorandum of Understanding for the inclusion of further CAM products concluded
7. Product implementation
8. Auction of the further CAM products foreseen
Page 16 of 46Bundling product and capacity platform – Hungary / Romania
Main 2011 2012 2013 2014 2015
Milestones Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
HU-RO
CAM in place
bundling
and
allocation
1. Transgaz and FGSZ signed MoU in order to co-operate on 3rdenergy package issues
2. Joint working groups established.
3. Platform for CAM-NC compliant offer of capacity completed and ready for use
4. Harmonising access rules involving both TSOs and NRAs
5. First capacity offer (monthly bundled capacity; 3rd Monday of November 2013)
6. Target for availability of further platform functions: handling of daily nominations and
renominations; secondary capacity trading.
7. Progressive introduction of further standard capacity products according to CAM NC auction
calendar and optionally outside of the calendar if so agreed between the project partners.
Coordinated implementation of CAM NC at all IPs between entry-exit systems in the South
Region: Spain, France and Portugal
Main 2012 2013 2014 2015
Milestones Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Spain -
Portugal
VIP (*)
Spain-
France CAM in place
border
IP between
GRTgaz
North and
GRTgaz
South (**)
1. Discussions with NRAs and agreement to develop a bundled capacity auction process
2. Finalisation and publication of associated documentation and corresponding approval by
NRA’s
3. Open Information Sessions for Shippers (Madrid and Lisbon)
4. Firm yearly product auctions: pre-qualification and qualification phases for shippers; capacity
bidding window (24 - 25 July)
Page 17 of 465. Firm monthly product auctions: pre-qualification and qualification phases for shippers;
capacity bidding window (10- 11 September)
6. Interruptible firm and monthly products auctions: qualification phases for shippers; capacity
bidding window (17-18 September)
7. Firm yearly products auction: pre-qualification and qualification phases for shippers; capacity
bidding window (27-28 June)
8. Firm quarterly products auction: qualification phases for shippers; capacity bidding window
(16-17 July)
9. Interruptible year and quarterly products auction: capacity bidding window (22-23 July)
10. Expected first annual yearly capacity auction in March 2014 using a common platform
11. Expected first annual quarterly capacity auction in June 2014 using a common platform
12. Expected first rolling monthly auction in September 2014
13. First rolling day ahead auction, subject to development of TSOs IT systems (the latest in Nov
15)
(*) 10, 11 and 12 will be possible if all interconnected TSOs develop their IT on time
(**) The schedule for implementing auctions at the IP between GRTgaz North and South areas
(via the PRISMA platform) is still under discussion in France.
Page 18 of 464.3. Geographical scope of the projects
The map below summarises the products that will be offered in 2013 in each of the countries
involved in pilot projects. As indicated in the previous section, several TSOs are envisaging the
implementation of further capacity products during 2014. This list of products reflects the
current status and it may be modified due to future internal evaluations by TSOs and discussions
with the relevant NRAs where necessary.
Fig 3. Products offered during 2013 by the pilot projects throughout the EU.
Page 19 of 464.4. Review of issues related to CAM Implementation challenges
This section aims to analyse the issues with implementation that have been encountered in each of the
projects in place or already planned and the barriers that may be faced by TSOs:
- General issues (including those areas where pilot projects are not currently in progress)
General issues and challenges
The likelihood that CAM NC will change somewhat during comitology leads
to concerns that early implementation may result in wasteful expenditure,
Stability of CAM NC
and hence a cautious approach by NRAs and TSOs in a number of
countries.
A large number of European and national initiatives are currently being
developed and implemented. This means that some countries (e.g. some
Workload/ prioritisation smaller countries and those with less experience of implementing
European energy legislation) are fully occupied with cannot devote
resources towards voluntary projects
Any change imposes costs on network users (e.g. costs of modifying their
IT systems). Particularly in areas of zero or very rare contractual
Network user support
congestion, network users have sometimes been resistant to moves
necessary
towards early implementation, as the current system in place may be
easier and less costly for them.
TSOs rely on a large number of complex, interconnected IT systems, the
nature and structure of which differ considerably between countries.
Integration of back end Integrating these systems with new front-end systems for the
systems implementation of CAM is a costly and time consuming process and in
some cases may be impossible to complete before the mandatory deadline
for implementation of CAM.
Early implementation requires that governments prioritise work on
Legality of CAM NC
reviewing and granting requests for derogations or on amending legislation
provisions
if needed.
Co-ordination with There may be a reluctance in some cases to re-open regulatory
regulatory regime settlements to allow early implementation of CAM
Due to the interconnected nature of their systems, TSOs generally have
Co-ordination between substantial experience in co-ordination with neighbouring companies. The
neighbouring regimes development of similar co-operation between neighbouring NRAs is also
essential for implementation; this is still under development in some cases.
Page 20 of 46- In those areas where pilot projects are already taking place:
TSOs and
Project Review of issues
NRAs involved
The early implementation of the CAM NC to such an extent in Europe
requires a pragmatic and coordinated approach between the different
19 TSOs NRAs and TSOs involved. Such a coordination is essential on e.g. the
involved following points (not exhaustive list):
Combined offer of bundled products at an IP
Definition of the big and small price steps at both sides of a border
Agreements on auction premium split
PRISMA Also, experience has shown that the European NRAs wish to converge
towards a limited amount of platforms. This requires a governance
process that needs to be agreed upon between the involved TSOs.
Other TSOs Finally, IT developments, both for the implementation of the auction
interested are algorithms and for the connection of the IT tools with the respective
welcome to join back-ends of the parties active on the platform represent a huge
the project amount of time, effort and money. But as it is shared amongst many
countries, these costs are optimised. These efforts will in the future
lead to create more proximity between the TSO offers, for the benefit
of gas sellers.
TSOs and
Project Review of issues
NRAs involved
Alongside the development and the entering into force of the CAM NC
the TSOs discussed an early implementation of the respective
provisions to gather experience (Pilot Project). After a successful pilot
the work is focusing on offering other CAM products prior to the
implementation deadline in November 2015. The work done is
Ontras and Gaz-
Bundled separated into the following milestone:
System (TSOs)
Product Agreement on concept and products to be offered during pilot
BNetzAand ERO (agreement on quarterly products – Pilot Project)
at Lasów
(NRAs) Definition of specific supplementary access conditions
Agreement on platform approach for the Pilot Project
Technical/practical connection to platform and backend definition
Agreement what future capacity should be offered as bundled
Memorandum of Understanding to implement the CAM products
IT-implementation to auction the residual products
Page 21 of 46TSOs and NRAs
Project Review of issues
involved
In the CEE region, the general environment for the early
implementation of the CAM NC, especially the introduction of
bundled capacity allocation necessitates close cooperation
between all TSOs and NRAs involved in the alignment of the below
criteria:
Network usage dimensions,
FGSZ and Transgaz
(TSOs) Licensing for genuine capacity bundling (i.e. any Network
User should have sufficient access to both transmission
HEO and ANRE systems concerned),
(NRAs) The issue of multi-currency environment should be
addressed
access rules for bundled capacity products,
TSOs that operate at least VTP should be accessible for Bundled Capacity
an IP may accede owners.
Bundled to the Regional The Regional Booking Platform concept and IT solution – due to
Product Booking Platform special regional regulatory, but also practical and financial reasons
and (RBP) both on user- – was created focusing on the following principles reflecting the
Capacity only or on equal expectations of a large number of various stakeholders:
Platform shareholding basis, High reliability (in order to accommodate Member State,
immediately or at NRA and customers’ S.o.S. concerns),
any later time. Scalability both in operations and offered services (on TSO
Hungary/
TSOs that join request),
Romania
before 2014 are Easy usage (on TSO and Network Users’ request),
given the Technical requirements for least cost/effort introduction,
opportunity to take and short implementation time (on TSO and Network
part in shaping the Users’ request),
terms of the Joint Fair business model based on real cost drivers (TSO and
Venture. NRA concern).
The Booking Platform particularly aims at offering services beyond
primary capacity sales:
Secondary Capacity Market services
o Title Tracking
o Anonymous Market Place
Single nomination and allocation,
Client Risk Management
Comfort services.
Page 22 of 46TSOs and
Project Review of issues
NRAs involved
The auction between Spain and Portugal in 2012 was very
useful to identify which regulations had to be adapted,
which documentation and processes had to be developed,
and to raise awareness among shippers of the implications
of the NC (“bundled capacity”, standard capacity
Coordinated products,…).
implementation GRTgaz, TIGF, The 2013 auction has followed the same pattern as 2012
of CAM NC at all Enagas and REN edition but some issues have been improved:
IPs between (TSOs) prequalification and qualification windows for shippers to
entry-exit participate in the allocation process have been extended;
systems in the capacity products offered, minimum bids for product per
CRE, CNE and price step.
South Region:
ERSE (NRAs) In 2012, the SGRI made progress in the common definition
France, Portugal
to achieve early application of CAM in the cross-border
and Spain interconnections in the Region and among the French
Balancing zones.
The IT systems implementation plans for the TSOs in the
Region is of utmost importance to develop the auctions, so
efforts are being made to progress in this issue.
Page 23 of 464.5. Review of lessons learned, solutions adopted and open
questions arising during CAM NC early implementation
The following tables present a number of issues which are not explicitly referenced in the CAM
NC but which often must be addressed during the implementation of the NC provisions. Each of
the tables gives a brief description of the issue and collects examples of solutions adopted.
Definition of price steps
Brief description Example/s of solutions adopted
The CAM NC does not specify the ratio The PRISMA platform allows any whole-number ratio
between the large price steps and the between small/large price steps. The number of price
small price steps, i.e. how many small steps is not limited.
price steps would be included in a large
price step.
At the Spain-Portugal VIP, price steps are defined on the
Operational discretion is left to TSOs and basis of a proportional incremental premium equal to 3%
booking platform operators. (arithmetic progression) of the tariff in each country with
30 price steps per Member State.
Auction premium from bundled capacity and split and destination of auction revenues
Brief description Example/s of solutions adopted
In article 26 of the CAM NC, the split of the
revenues above the reserve price is left to At the IPs where capacity is allocated via PRISMA, the
the agreement between TSOs and to the default rule (50:50 split of the auction premium) is applied,
approval by NRAs. In the absence of an unless otherwise justified on a case-by-case basis and
agreement, a default rule of equal split approved by the relevant national regulatory authority, if
(50:50) is applied. This implies that different necessary.
alternatives are possible if TSOs agree on a
different split (and NRAs approve it);
different practices can be observed.
At the Spain-Portugal VIP, the default rule is also applied.
Regarding the destination of congestion
revenues, or auction premium, it has been
noted that Chapter 4 of the Tariffs FG
addresses this issue.
Page 24 of 46Inter-relation between CAM and CMP
Brief description Current status
A number of provisions of the CAM NC have
interactions with some of the requirements on The eventual concurrent implementation of the
CMP Guidelines. Examples are the provisions CMP Guidelines and CAM NC requirements and
related to the offer of bundled capacity at both potential coordination issues are analysed in a
sides of an IP in combination with the document3 developed by ACER in spring 2013, with
implementation of the capacity surrender limited input from ENTSOG and selected industry
mechanism established by the CMP Guidelines. associations4, which is now published on the ACER
The application of these provisions from the website5.
CAM NC and the CMP Guidelines has to take
place in a compatible and consistent way.
Bundling of different firm capacity products
Brief description Example/s of solutions adopted
On PRISMA, two bundling approaches are possible:
Classic bundling approach, where the bundling of
capacity products is done “offline” by the TSO. TSOs
submit bundled or unbundled products which cannot
be changed by the platform. The coordination and
The amount of capacity that can be bundled matching implies “offline” coordination between TSOs
at each IP is in some cases limited due to especially regarding day-ahead products;
the existence of asymmetric available
capacity at both sides of the IP. Moreover, Cross bundling approach, where the bundling of
different levels of capacity firmness at each capacity products is done “online/automatically” by the
side of the IP may require specific rules to platform. TSOs submit capacity raw data (currently
allow for effective bundling. booked and available capacity) to the platform. The
matching and creation of the bundled and unbundled
products is done by the platform in accordance with
applicable legal/regulatory framework, in a sequential
manner according to a priority order where products of
different types or “flavors” exist at one side of the
border.
3
“Issue paper” on the need for coordinated decisions at EU level for the implementation of the CMP guidelines.
4
ACER half-day workshop held on 12 June 2013.
5
http://www.acer.europa.eu/Official_documents/Acts_of_the_Agency/Publication/ACER_CMP_Guidance issue
paper on CMP implementation_20130808.pdf
Page 25 of 46Costs of booking platforms
Brief description Current status
With the establishment of joint booking platforms, two issues arise:
(i) the split of fixed and variable costs across the TSOs which join the
The establishment and use of platform (which is an internal matter to be decided upon by those
‘joint web-based booking TSOs)
platforms’, as required under the (ii) recognition by relevant NRAs of the costs borne by TSOs in the
CAM NC, involves capital allowed revenues (or equivalent in non-revenue cap regimes).
expenditure and operational The establishment of joint booking platforms is required by CAM NC
expenditure to be incurred by (article 27) and the related costs should be recovered. In a number
TSOs. of Member States, NRAs have already recognised the joint platform
costs incurred by TSOs. However, in others, this recognition is still
How such fixed and variable pending. Some NRAs have recalled that insurances must be given
costs are shared across the TSOs that all TSO costs, including any incurred for joint booking
using a given platform and platforms, are efficiently incurred by TSOs and that the costs of
whether they are recognised as setting up or joining an alternative platform should be considered.
‘efficiently incurred’ by the This is an outstanding issue in some projects where a decision in this
relevant NRAs remains an open respect will have to be taken by NRAs, defining practical solutions as
issue in some Member States. soon as possible where recognition of costs has not yet taken place.
In addition, the absolute and relative costs of joining some existing
platform are a key concern especially for small and medium-sized
TSOs (e.g., those in Ireland, Portugal and Slovenia).
Activities of joint platforms and need for appropriate exchange of information
Brief description Current status
TSOs should ensure that CAM With the objective of transparency, a copy of the general terms
implementation activities which and conditions (GTs&Cs) between PRISMA and network users is
take place via joint platforms are available on the ‘Download’ webpage, a public section of
transparent to the market and PRISMA’s website. For a revision of the GTs&Cs planned for 1
NRAs, allowing appropriate January 2014, PRISMA conducted a public consultation, including
exchange of information. a public workshop, to solicit any questions or concerns from
network users.
Page 26 of 46Harmonisation of capacity contracts at both sides of the border
Brief description Current status
The implementation of the CAM NC will
result in the harmonisation of a number of Concerns have been expressed by some stakeholders,
aspects of capacity contracts (duration, such as EFET, regarding existing differences among the
units, etc.). The CAM NC, however, does not contractual terms applied by TSOs at both sides of an IP
require standardisation of capacity products (e.g. different degrees of firmness) which create
in terms of firmness. Further harmonisation inefficiencies or additional costs. In contrast, some other
of contractual terms will result eventually network users have asked that the rights underlying the
when other network codes are existing contracts are maintained.
implemented (e.g. the balancing network
code as regards nominations). Some The above concerns are expected to be treated as part of
stakeholders, however, are calling for yet the scoping exercise for the proposed network code on
additional harmonisation. The appropriate Rules for Trading.
degree of harmonisation of capacity
contracts is an open issue and requires
analysis at EU-level.
Different currencies in use at each side of the border
Brief description Example/s of solutions adopted
In the HU/RO project, it was decided to keep the reserve price
in the corresponding currencies and then execute the bids in
percentages of the reserve prices.
When TSOs allocate capacity at IPs In the project between PL/DE at Lasów IP, a different approach
where the currency in use at each
has been followed as one currency (€) was selected for the
side of the border is different,
bids. The applicable exchange rate is the same as that applied
operational challenges arise. In
at the moment of the completion of auctions.
such situations, TSOs are working
in order to solve the potential
issue. In PRISMA, only the currency for the Danish TSO, energinet.dk,
is different from the euro used elsewhere. At the moment, no
currency conversion mechanism has been implemented on the
platform itself. Energinet.dk is responsible for converting
Danish kroners into euros (and vice versa) when sending
(receiving) data to (from) the platform.
Page 27 of 46Harmonisation of the gas day between countries with different time zone
Brief description Example/s of solutions adopted
Potential issues could also arise This issue was addressed bilaterally in a successful way wherever
when TSOs allocate capacity at IPs it appeared. Given that the standard gas day is now defined
where the time zones are different (Article 3 “Definitions” of the CAM NC), this should not be an
at both sides of the border. TSOs issue for CAM early implementation projects in the future.
are working in order to tackle the
potential issue.
Licensing issues
Brief description Example/s of solutions adopted
Energy shippers in Hungary and some other Central-Eastern
European Member States are required to obtain a licence to
trade gas at wholesale level; however, the licence criteria differ
The different requirements in from Member State to Member State. A form of cross-border
terms of licenses for the users to licensing is therefore needed. This is a key issue that is being
operate in different countries addressed in discussion with NRAs.
might create in some cases a
potential obstacle to take into In France, all network users are required to obtain a licence from
account when accessing bundled the government, which then enables them to sign a transmission
capacity at certain IPs. contract with GRTgaz and/or TIGF. It is not, however, the task of
the TSO to check the validity of the licence, as it is a
representation of the network user who commits on it and
remain liable for any misrepresentation.
Page 28 of 464.6. Key factors for success in early implementation of CAM
The following table lists identified key factors for success (KFSs) in early implementation of CAM
NC based on observation of projects and interviewing project participants. The key factors have
been identified in two separate groups: project specific factors and problematic issues of
general interest. With regards to the first group, TSOs and NRAs have the role to identify and
report on the steps needed in order to successfully implement the pilot project. For wider
factors with European scope, these should be addressed within the structures described in the
‘Governance’ section.
Project specific factors
Legal and regulatory National regulatory rules shall allow for the early
environment implementation of CAM (*)
Coverage of CAM NC requirements shall be as wide as possible
Degree of coverage of CAM Currently key aspects such as the offer of bundled capacity and
NC the implementation of
Coordinated auctions is developed in several pilot projects
Strong commitment and support from all parties involved is
Strong support from all needed
parties (TSOs, NRAs, GRIs, ENTSOG, ACER, the EC, Member States and
Network Users)
NRAs shall guarantee that the costs efficiently incurred by TSOs
Coverage of costs
are covered e.g. by tariffs
* With regards to regulatory requirements: other pieces of legislation at national level that have
an impact on CAM implementation shall be identified by TSOs and NRAs. TSOs and NRAs will
monitor draft legislation in development and will highlight the pieces that need to be changed
to allow CAM Implementation.
Page 29 of 46European factors (wider scope)
The share of experiences allows opportunities for other TSOs
to learn from experience gained in pilots
Share experiences
It minimises the duplication of efforts and the existence of
inefficient costs
Stability is especially important with regards to auction
Stability of provisions in CAM
algorithms,
NC
due to its impact on the design of IT projects
Geographical diversity of pilot projects allows wide
Geographical diversity
implementation of CAM NC in Europe
Ability of TSOs to devote resources to develop new solutions is
Resources
also a required condition
Convergence Progressive convergence of projects is strongly recommended
Page 30 of 46ANNEX 1: PILOT PROJECTS MAIN FEATURES
A. PRISMA and current participating bundling initiatives
Member
TSOs involved States Project description
Involved
19 TSOs involved: - Common platform for the allocation of
Bayernets, BOG, Energinet Austria, capacity according to CAM NC rules
DK, Fluxys Belgium, Belgium,
FluxysTenp, Gascade, Gas Denmark, - The common platform is operation since April
Connect Austria, GRTgaz, France, 2013
GRTgaz Deutschland, GTS, Germany, - New functionalities, e.g. secondary market and
GTG Nord, GUD, Nowega, Italy, within day, will be implemented
Ontras, Open Grid Europe, Netherlands
Snam Rete Gas, TAG, (at present) - The platform is open to all TSOs interested in
Terranetsbw, Thyssengas the project.
Project Features
The service company is operating the platform, carry out auctions and distribute the
products on behalf of the TSOs since April 2013.
The shares & costs of the new company are distributed over the participating countries
based on the ENTSOG voting rules.
The platform connects the different backend systems of the various TSOs using standard
IT-communication interfaces.
Requirements have been developed by TSOs and platform operators; the requirements
have been evaluated by and discussed with IT specialists.
Existing infrastructures has been effectively used to ensure cost efficiency.
The platforms TRAC-X, Capsquare & Link4Hubs, have been replaced by the new joint
platform which uses all their benefits and collective experience.
With the joint platform shippers are able to book capacities at European network points
through one single tool.
Currently 277 shippers and more than 830 users are using the platform
In addition the platform is able to handle regional regulatory specifics of different
countries
Secondary market features will be implemented in 2014
Within day will be implemented at latest by November 1 st 2015
Page 31 of 46Bundled capacity allocation at Tarvisio-Arnoldstein
Member States
TSOs involved Project description
Involved
Allocation of bundled capacity according to CAM
Network Code rules via a proposal for day-ahead
capacity allocation at Austria-Italy IP in order to better
TAG, Snam Rete
Austria, Italy connect Baumgarten and PSV hubs.
Gas
- Firm and interruptible bundled day-ahead
capacity allocated in both flow directions.
- IP involved: Arnoldstein/Tarvisio
Background
In July 2011 TAG and SRG have developed a joint procedure for the coordinated interruptible
capacity allocation at both sides of the IP being assigned via auction on TAG system and with a
corresponding nomination on SRG system. At the beginning of 2012 the concerned NRAs and
TSOs have started to work on the early implementation of CAM NC for the allocation of day-
ahead capacity.
Project Features
A joint task force has been established amongst NRAs and TSOs. Joint guidelines related to the
adoption of the CAM NC provisions have been developed by the NRAs and shared for comments
with the involved TSOs, which have been subsequently formally consulted in autumn 2012. The
Joint guidelines are intended to provide the required regulatory background to TAG and SRG for
the early implementation of the CAM NC provisions concerning day-ahead capacity.
The project has been presented in the SSE GRI and warmly welcomed by stakeholders.
SRG and TAG have taken part to the establishment of the Joint capacity platform (PRISMA)
through which they are offering bundled day-ahead capacity products at Arnoldstein/Tarvisio.
Joint Guidelines (consulted with stakeholder during October 2012) have been published in early
2013. Network Code and Terms & Conditions resulted consequently updated in order to
implement the new provisions.
Allocation of daily bundled capacity products (firm and interruptible) according to the CAM NC
provisions has started in April 2013.
Next steps
The introduction of other products is under evaluation by concerned parties and is foreseen
during 2014.
Page 32 of 46B. Bundled Product at Lasów
Member States
TSOs involved Project description
Involved
Allocation of bundled capacity according to CAM NC
rules.
The aims of the project are:
- Define how a bundled capacity product can be
Ontras, Germany, implemented between Germany and Poland.
- Early implementation of CAM NC rules (for selected
products during pilot phase and the residual CAM
products afterwards).
- Via a pilot phase, test if and how further bundled
products can be offered.
- Learn from experiences for future
Gaz-System Poland cooperation/development stages.
- Work towards the integration of the European gas
market.
Project Features
The auctions are carried out on the basis of the CAM NC
During the pilot phase, the TSOs offered quarterly capacity products for the first three
quarters of 2014.
Both TSOs intend to implement:
Yearly products according to CAM as of March 2014 (and in the following years)
Subsequent quarterly products as of June 2014 (and in the following years)
Monthly and daily CAM products and intend to offer these products as of end 2014
Page 33 of 46Contract set up
Achievements
Concept paper agreed with NRAs in summer 2012
Capacity to be bundled in the future agreed
Cooperation Agreement finalized
Specific Terms & Conditions developed
Joint Product Description Paper published
Service Agreement with PRISMA finalized
Market consultation held from 5th until 23rd of November 2012 including a Shipper
Workshop on 15th November
Terms & Conditions of both TSOs published
Shipper Manual how to register with the TSOs/platform and how to auction the capacity
developed and published
Shipper registration in April and May 2013 completed
On the 3rd and 4th of June 2013, the Transmission System Operators (TSO) GAZ-SYSTEM S.A.,
Poland and ONTRAS Gastransport GmbH, Germany (ONTRAS) for the very first time offered the
bundled capacity products at the interconnection point Lasów.
Results
The three auctions have been carried out properly. Resulting of the shipper bids the following
bundled capacities were allocated:
2nd quarter of Gas Year 2013/2014 [January 2014 – March 2014] auctioning 57,980 kWh/h
(5,200 nm3/h):
Page 34 of 46o Allocated capacity: 57 000 kWh/h
o Free capacity: 980 kWh/h
3rd quarter of Gas Year 2013/2014 [April 2014 – June 2014] auctioning 57,980 kWh/h (5 200
nm3/h):
o Allocated capacity: 20,100 kWh/h
o Free capacity: 37,880 kWh/h
4rd quarter of Gas Year 2013/2014 [July 2014 – September 2014] auctioning 57,980 kWh/h
(5,200 nm3/h):
o Allocated capacity: 21,115 kWh/h
o Free capacity: 36,865 kWh/h
Next steps
In May 2013 ONTRAS and GAZ-SYSTEM signed a Memorandum of Understanding for better
cooperation and further works on bundling the capacity in future.
Both TSOs committed to implement the provisions of the European Network Code on
Capacity Allocation Methodologies ahead of its official entering into force.
Page 35 of 46C. Hungary-Romania capacity bundling and allocation project
Member States
TSOs involved Project description
Involved
Allocation of bundled capacity on the HU-RO
FGSZ, Hungary, interconnector via Booking Platform according to the
CAM NC.
The HU/RO interconnector went operational in fall 2010.
The project was eligible for EEPR funding. It serves the
Transgaz Romania purposes of both security of supply and market
facilitation.
Background
Transgaz and FGSZ signed a MoU in July 2012 in order to cooperate on 3rd Energy Package
issues as well, establishing five joint working groups for:
o Capacity bundling and booking platform (pilot project)
o Alignment of network usage dimensions
o Alignment of operational balancing
o Alignment of commercial balancing
o Enabling bidirectional gas flow
Project Features
Phase I of the pilot project – lifting barriers and introducing short term bundled products that
are allocated via the Regional Booking Platform
Development of the Romanian VTP under discussion
Harmonized VTP-VTP access rules involving NRAs (HEO and ANRE) in order to enable genuine
capacity bundling (‘product bundling’),
Simplified licensing process
Harmonization of gas day (according to CAM NC)
Bundling of the following products according to CAM NC auction calendar
o Monthly capacity and Day-ahead capacity
o Allocation of bundled capacities via the Regional Booking Platform
o Synchronised and simplified nomination rules
Phase II of the pilot project – introducing all standardised products
Bundling of Within-Day capacity, Quarterly capacity and Yearly capacity
Introducing additional services e.g. secondary capacity transactions, all nominations via the
Page 36 of 46Booking Platform
“RBP” Regional Booking Platform
The Regional Booking Platform (RBP) was especially developed in order to comply with the
CAM NC requirements. The RBP is a stand-alone software, a ready-to-implement, fully CAM
NC compliant solution.
The RBP has a web-based functioning as a thin client, i.e. TSOs and Network Users can
continue using their existing back-end systems, there is no or almost no back-end
development requirement due to the RBP software design. This solution ensures the most
overall costs efficiency considering the vast variety of existing TSO and Network User back-
end systems.
High-performance scalable design that can accommodate in theory all simultaneously
running auctions of all the European IPs at the same time.
High reliability criteria are defined
o permanently available test environment for new releases,
o at least 99.95% availability,
o continuously running backup service at a different physical site,
o security is ensured through https connection and user authentication issued by
trusted provider,
Open-end development, i.e. new European or national regulatory requirements or TSO
business ideas can be added in a flexible way.
From a technical point of view, it is ready to be used, however the actual start of the
platform depends on when harmonized national rules enable its usage (see the Main
Milestones section).
Available functions as of 6th September 2013:
o All Phase I & II capacity products are available for booking,
o CAM NC auction algorithms (uniform price and ascending clock),
o Auction calendar (automatic and manual),
o System and business entity setup
TSO setup,
Capacity available for bundling,
Network User credit limit.
IP setup,
Network User setup,
Indication of active IPs,
Licensed shippers checked by TSOs,
Network User representative authentication.
o Capacity bundling and capacity roll-over,
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